Premiers answer calls for direct hotline

• Source: Global Times
• [03:09 June 01 2010]
• Comments

China claims indisputable sovereignty over the Diaoyu Islands and adjacent islets in the East China Sea. Japan also regards the Diaoyu Islands as its own territory.

The two countries also disagree on overlapping claims of their extended continental shelf where both countries have oil-drilling platforms.

"It is an issue that could easily cause skirmishes and trigger escalated clashes," Sun said. "Both governments have realized its importance and begun to set up a prevention mechanism."

Wen and Hatoyama agreed Monday to resume negotiations on implementing a principled consensus on the East China Sea issue reached two years ago - a move seen by ana-lysts as a step forward.

According to the agreement from 2008, the Japanese side can participate in the cooperative development of the Chunxiao oil and gas field in accordance with relevant laws of China, but "cooperative development" is different than "joint development."

The leaders also signed agreements on food safety, energy conservation, environmental protection and e-commerce.

"Despite all the disputes over the East China Sea and food safety, the major tendency of Sino-Japanese ties is positive, with their economic fates increasingly intertwined," Huang said.

For China, Japan's technology and direct investment, which totaled $4.1 billion in 2009, are vital for future development.

On the other hand, demand from China and other emerging Asian markets has helped Japan recover from its worst recession in decades, while an easing of travel restrictions has triggered a surge in Chinese tourism to Japan.

China is Japan's top trade partner, with two-way business reaching about $230 billion last year, exceeding Japan-US trade for the third year in a row.

Japanese business leaders see more opportunities in Chinese demand.

But some see a blow to Japanese pride from the rise of China, which is expected to overtake Japan as the world's second-largest economy as early as this year.

"China sees Japan as a strategic partner, not a competitor or a rival. The two neighbors should view each other as partners so as to have peaceful coexistence and long-lasting friendship," Premier Wen said Monday in Japan.

Agencies contributed to this story